Companies established under Thai law that pay dividends to shareholders must withhold tax at source, as follows:

1. Thai resident individuals
2. Non-resident individuals (who stay in Thailand for less than 180 days)
   • Withholding tax rate: 10%
   • Also under Section 50(2)(j)
3. Companies or juristic partnerships
   • Registered in Thailand, or
   • Foreign companies operating in Thailand
   • Withholding tax rate: 10%, unless:
     • The receiving company is a listed company or limited company that holds ≥25% voting shares of the paying company, and
     • The paying company does not hold shares in the receiving company (directly or indirectly)
       ➤ In such case: No withholding tax required
     • Based on Revenue Department Order No. ท.ป.4/2528, Clause 5
4. Foreign companies not operating in Thailand

Reference No. 405645
Subject: Withholding tax on dividend payments to individual and corporate shareholders, both domestic and foreign.

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Corporate Income Tax: Section 34 BOI Tax Incentives
(Dividend Exemption for Promoted Businesses)

Dividends paid from businesses that have been granted tax exemption under Section 31 (BOI-promoted projects) are not subject to corporate income tax during the promotion period.

Key Points under Section 34:

• Exemption applies only to dividends from BOI-promoted projects
• Dividends must be paid and received during the exemption period
• No withholding tax is required for these dividends
• If a company has profits from both BOI and non-BOI activities:
  • May choose the source of dividends
  • Must record it in meeting minutes
  • If not specified, allocate dividends proportionally
• Dividends may be paid in the form of shares, and still qualify for withholding tax exemption